In this episode of the Legit Ledger, Sheppard Mullin attorney Michael Driscoll joins host Afruz Sayah to discuss the current crypto bankruptcies involving Voyager and Celsius, including the circumstances that led to those bankruptcies, why the introduction of crypto complicates a Chapter 11 proceeding and how these latest bankruptcies will clarify legal issues around crypto insolvencies.
What We Discuss in This Episode:
- How did you become involved in blockchain and crypto?
- What led to the Voyager and Celsius bankruptcies?
- Why didn't these platforms have enough liquidity?
- Both platforms froze all accounts. Is that something they can legally do?
- How did the two products Celsius offers play into its bankruptcy?
- Why did these platforms choose Chapter 11 bankruptcy over Chapter 7?
- What will happen to the creditors' frozen assets during Chapter 11 proceedings?
- Why does the intro of crypto make a Chapter 11 proceeding more complicated?
- Do you think these bankruptcies will clarify the legal issues around crypto insolvencies?
- How do fraudulent actions play into bankruptcy proceedings?
- Does bankruptcy offer fraudulent actors any protection from criminal or civil proceedings?
- How will deposits be distributed to creditors once Chapter 11 concludes?
- Leaked audio suggests Celsius executives wanted to create an IOU cryptocurrency. What are your thoughts on such a plan?
About Michael Driscoll
Michael Driscoll is a partner in the Finance and Bankruptcy Practice Group in the Sheppard Mullin New York office, where his practice focuses on problem loan workouts, bankruptcy, judicial and non-judicial foreclosure and creditors' rights and commercial law.
Prior to joining Sheppard Mullin, Michael served as a Trial Attorney in the United States Department of Justice's Office of the United States Trustee for the Southern District of New York. During his tenure, he represented the United States Trustee's office in over 150 Chapter 11 cases by ensuring compliance with applicable laws, rules, and regulations during all phases of bankruptcy cases.
About Afruz Sayah
Afruz Sayah is an associate in the Corporate and Blockchain Practice Group in Sheppard Mullin's New York office, where her work focuses on capital markets matters with a main concentration in blockchain, cryptocurrency, NFT, and other digital assets. Additionally she advises clients on ongoing compliance and regulatory issues of various digital assets 0from the SEC and CFTC.
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